Archive for May, 2012

Poorly Designed Medicaid & Estate Plans Can Harm Divorced Children

Posted on: May 29th, 2012 by Lawrence A. Friedman

Recent New Jersey cases illustrate that poorly drawn Medicaid planning and estate planning gifts actuallly can harm divorced children at times.  In New Jersey, New York, and other states, spouses’ rights to receive or pay alimony and child support depend in part on relative income and assets.  Thus, the custodial parent’s child support might fall if his/her income rises while the non-custodial parent may have to pay more if his/her income rises.  By the same token increases in income may lead to correspondng changes in alimony rights and obligations.  Therefore, estate and Medicaid planning should take a child’s divorce or shaky marriage into account.

The New Jersey Appellate Division just ruled that a family court must consider whether the ex-wife’s alimonly and child support should be cut due to her mother’s Medicaid planning gift of the mother’s home.  Maybury v. Maybury (unpublished A4338-10, May 25, 2012).  The former husband argued that an unencumbered home is a valuable asset that should lead to income being imputed to the former wife.  Although the Appellate Division remanded the case for further fact finding, they agreed with the husband’s argument that receipt of a high value gift like an unencumbered home can be taken into account in fixing alimony and child support obligations.  The Appellate Division also directed the family court to consider whether the transfer satisfied Medicaid requirements in evaluating the divorce impact.  Thus, from a divorce perspective, it would have been desirable for the Medicaid planning gifts to leave the former wife off the list of donees.

A New Jersey Supreme Court decision late last year similarly confirms that estate planning gifts can impact a divorced spouse’s  alimony and child support rights and obligations.  Tannen v. Tannen, 208 N.J. 409 (2011).   Here, the husband sought to limit his child support and alimony obligation to take account of income the ex-wife could expect to receive from a trust established by the former wife’s parents.  The Court ultimately held that the trust at issue shouldn’t impact divorce rights and obligations because the trust didn’t give the ex-wife any right to force the trust to distribute.  However, it is equally clear that a trust that does give a spouse distribution rights could be taken into account in fixing alimony and child support.

In a slightly different vein, Medicaid or estate planning gifts also can impact a recipient’s higher education obligations and financial aid.  In short, when developing and drafting Medicaid and estate plans, it is important to keep the overall picture in mind and avoid tunnel vision.

Don’t Fall Victim to a Social Media Scam

Posted on: May 21st, 2012 by Lawrence A. Friedman

As more of us use social media as an investment tool, scammers are coming up with innovative ways to separate us from our money, and some of these scams target seniors directly.  How can you avoid becoming a victim of fraud?  The first step is to exercise the same kind of caution you would if a stranger asked you for money.

Deals that sound too good to be true usually are.  Legitimate investment offers rarely require an immediate decision.  Just as you likely would be skeptical of door to door sales, unsolicited offers over the internet should prompt caution.  Some scams target affinity groups while other hucksters may play fast and loose with the truth when claiming an arrangement is endorsed by or benefits a well known affinity group or charity.

To keep from sharing personal information that might prove useful to perpetrate identity theft, it’s important to manage your profile and privacy settings wisely on sites like Facebook.  Exhibiting healthy skepticism toward unfamiliar credentials can help safeguard your money.  For instance, to become Certified as an Elder Law Attorney by the National Elder Law Foundation, I had to pass a full day exam and meet stringent requirements regarding ethics, malpractice, continuing legal education, and experience with elder and special needs law, but some fancy sounding titles can be obtained over the internet just by paying a fee.

Your strongest defense against becoming a victim of fraud is your own common sense. Ask questions until you are sure you understand an offer, and it’s worth repeating… if it sounds too good to be true, it probably is.

To bolster your defenses further, see the Securities and Exchange Commission’s bulletin Social Media and Investing Tips for Seniors at

The internet can be a wonderful tool, but like most other facets of life, it’s important to exercise common sense.

Child Liable for Mother’s Nursing Home Bill

Posted on: May 8th, 2012 by Lawrence A. Friedman

Pennsylvania (like many other states) has a filial responsibility law that generally requires children with means to support an indigent parent. While it may seem unfair, a Pennsylvania court recently enforced the law to hold a son liable for his mother’s $93,000 nursing home bill despite the son’s claim that he couldn’t afford to pay. Health Care & Retirement Corporation of America v. Pittas (Pa. Super. Ct., No. 536 EDA 2011, May 7, 2012).

However, it didn’t have to be this way if only the family consulted elder law attorneys such as FriedmanLaw when the mother first needed care. Elder care lawyers could have helped the mother qualify for Medicaid to pay for her care instead of leaving the son to be saddled with a high nursing home bill for his mom. The moral of this story is pretty simple; consulting elder law counsel early on can yield major savings down the road.

Further information on funding long term care without going broke and other subjects is available throughout To subscribe to our frequent blog updates, click on “Subscribe to this Blog” in the Meta box to the left and then click on “subscribe to this feed.”

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Homepage photo: Cows grazing at Meadowbrook Farm, Bernardsville, NJ by Siddharth Mallya. October 23, 2012.
Interior photo: Somerset hills pastoral scene by Lawrence Friedman.